Half-year Report

Legal Entity Identifier:  213800NN42KX2LG1GQ40

21 May 2018

Finsbury Growth & Income Trust PLC

Half Year Report & Financial Statements
for the six months ended 31 March 2018

Financial Highlights

	As at	As at
	31 March	30 September	%
	2018	2017	Change
Share price	750.0p	736.5p	+1.8
Net asset value per share	741.1p	732.8p	+1.1
Premium of share price to net asset value per share^	1.2%	0.5%	–
Gearing1^	2.1%	1.9%	–
Shareholders’ funds	£1,227.6m	£1,164.4m	+5.4
Number of shares in issue	165,646,712	158,896,712	+4.2

	Six months to	One year to
	31 March	30 September
	2018	2017
Share price (total return)2^	+2.8%	+14.2%
Net asset value per share (total return)2^	+2.1%	+13.7%
FTSE All-Share Index (total return)* (Company benchmark)2 3	-2.3%	+11.9%

	Year ending	Year ended
	30 September	30 September
	2018	2017
First interim dividend	7.2p	6.8p
Second interim dividend	Yet to be declared	7.4p

¹ See glossary

² Source – Morningstar

³ Source – FTSE International Limited (“FTSE”) © FTSE 2018*

^Alternative Performance Measures (“APMs”)

The disclosures of performance above are considered to represent the Company’s APMs. Definitions of these APMs together with how these measures have been calculated can be found in the Glossary.

Chairman’s Statement

Performance

In the six months to 31 March 2018 the Company delivered a net asset value total return of 2.1% and a share price total return of 2.8%. Both have outperformed the Company’s benchmark, the FTSE All Share index, which fell by 2.3% over the same period. The principal contributors to the Company’s net asset value (“nav”) performance were Fidessa, Hargreaves Lansdown and London Stock Exchange. The main detractors were RELX, Unilever and Sage Group. Further information on the Company’s portfolio can be found in our Portfolio Manager’s Review.

Share Capital

Consistent demand for the Company’s shares has led to the issue of a total of 6,750,000 new shares in this half year, at an average premium to nav per share of 0.7%, raising £50.6 million. As at 31 March 2018 the Company had 165,646,712 shares of 25p each in issue (31 March 2017 151,245,712). Since the end of the half-year, to the date of this report, a further 1,635,000 new shares have been issued raising £12.4 million. As at 18 May 2018, the Company had 167,281,712 shares in issue.

Dividend

The Board has declared a first interim dividend of 7.2p per share, compared to last year’s first interim dividend of 6.8p per share, an increase of 5.9%. The dividend will be paid on Thursday, 17 May 2018 to shareholders who were on the register on Friday, 6 April 2018. The associated ex-dividend date was Thursday, 5 April 2018.

The Board expects to declare the second dividend for the year ending 30 September 2018 in October 2018 and for it to be paid to shareholders in November 2018.

Amendments to the Company’s Investment Policy

Since 30 September 2017 the Board has made two minor amendments to the Company’s Investment Policy which are not considered material:

• The Company’s gearing Policy contained within the old investment guidelines has been amended to remove reference to the expected level of gearing being between 5% and 25% of the Company’s net assets; and

• Reference to a minimum position size of 1% of the Company’s gross assets being held unless the holding concerned is being built or disposed has been removed.

These amendments have been made in order to provide greater flexibility in the management of the investment portfolio.

Gearing

The Company is in the second year of its three-year secured fixed term multicurrency revolving credit facility with Scotiabank Europe PLC (the “Facility”). The amount drawn under the Facility lies comfortably within the Company’ gearing limit.

Change of Service Provider

As previously announced with effect from 3 April 2018, The Bank of New York Mellon (International) Limited were appointed, in place of BNY Mellon Trust & Depositary (UK) Limited, as depositary to the Company pursuant to internal restructuring at Bank of New York Mellon. This was in essence an internal administrative reallocation within the Bank of New York Mellon group.

Details of the fees and material terms of the Depositary Agreement are available in the Company’s investor disclosure document, which can be accessed on the Company’s website www.finsburygt.com.

Key Information Document

Shareholders may be aware that new regulations, the Packaged Retail and Insurance-based Investment Products (“PRIIPs”) Regulations, came into effect from 1 January 2018. Under these regulations, the Company is required to prepare and publish a key information document (“KID”) to help prospective investors understand the nature, risk and costs of investing in this Company and to allow comparison with others.

The content of the KID is highly prescriptive, both in terms of the assumptions underlying projected future returns under prescribed scenarios and the limited scope to provide further explanation of the content. Shareholders should note that the procedures for calculating the risks, costs and potential returns are prescribed by law and that expected performance returns cannot be guaranteed. It should not necessarily be assumed that past performance is a guide to future performance.

The Directors believe that prospective investors in the Company should only use the KID in conjunction with other documentation produced by the Company, including the annual report and monthly factsheet, which is published on the Company’s website at www.finsburygt.com.

Half Year Report and Accounts

As I mentioned last year, in the interests of cost control we will not be providing a printed copy of this year’s Half Year Report and Accounts. This document is and will continue to be available on the Company’s website at www.finsburygt.com. The Company’s Annual Report will continue to be available in a printed copy, and on the Company’s website.

Outlook

As we look forward, our Portfolio Manager remains optimistic about the outlook and opportunities for the companies in our portfolio. Your Board continues to believe that our Portfolio Manager’s strategy of investing for the long-term in durable cash generative franchises capable of sustained dividend growth will continue to deliver superior investment returns to shareholders.

Anthony Townsend

Chairman

21 May 2018

Portfolio Manager’s Review

We outperformed in the period. We are always grateful to do so and it’s truly always a surprise; although we never put too much significance on individual six-month returns. That way madness or overtrading lies. But the outperformance is a bit noteworthy we think – because it is not supposed to be happening. What I mean by that is we are told that our investment approach for Finsbury Growth & Income Trust PLC (‘Finsbury’) of concentrating on “quality” equity assets (which we do) makes the strategy particularly vulnerable during periods of rising interest rates, rising inflation and accelerating economic growth. In this environment – again we are assured – we should expect “value” and “cyclicals”, which we don’t own, to outperform.

Now, as we often say to Finsbury shareholders – of course it is possible we will underperform for a period of time, if only on the principle of what goes up must come down. But if we are to underperform it does not appear to have begun yet, despite the fact that interest rates have duly gone up and commodity prices have been strong – certainly Oil is up 23% over the period, with gains for Gold and Copper too. Why is this?

First, it is too simple to say that if rates go up all so-called interest rate sensitive shares will fall. While it is true that, for instance, Unilever has fallen 8% over the 6 month period and Diageo 2%, it is also true that other consumer branded goods shares have done rather better. Within your portfolio Heineken is up 5%, Dr Pepper up 33% (admittedly because of a bid), while Youngs, Remy, AG Barr and Mondelez are also showing gains. In other words company specific factors can be more important than industry generalisations based on macro-economic theorising.

Next – and more important – we think it is misleading to categorise your portfolio as being full of bond proxies. Some may do so; we certainly don’t. Instead, we think it more appropriate to look at it as a collection of undervalued growth companies. In your portfolio growth companies certainly include London Stock Exchange up 8% over the 6 months, Fidessa 63% (another bid), Hargreaves Lansdown 11%, Manchester United 7%; even Pearson is up 22%. These are just as much “Finsbury-type” investments as Johnnie Walker and Dove Soap. But it is not obvious that the direction of interest rates is relevant to how these growth companies will perform as businesses or as share prices. In short, your portfolio is more diverse – despite the focus on a few themes – than it is sometimes given credit for.

Finally – the continued outperformance of tech-related and growth stocks (note, NASDAQ is still up over 9% over the period – there are not many cyclical value stocks in that index) – is confirmation of our view that the pertinent question for equity investors in 2018 is not “should I invest in either beer or coal” – as investment bank equity strategists imply , but, instead, “how can I find ways to participate in the bull market being driven by digital technology and how to avoid industries and companies being disintermediated by digital technology”? Our performance (and that of everyone else) will be determined by how successful we are in this analysis, we think.

This is not to say we think for a minute that we have constructed a portfolio for you that will outperform in all market conditions. But we do think it likely that any possible future underperformance will be the result of a mistake we make in assessing the earnings power of a given business in the changing circumstances of the digital revolution in this second decade of the 21st century. Mistakes of this nature – and for a number of years our investment in Pearson has appeared to be an example – are all too easily made in a period of rapid technology change. Although we still think Pearson has a chance to make a successful transition to being a predominantly digital service provider.

So we’re not patting ourselves on the back for the period’s outperformance. But it really does strike us that some of the recent falls in our major holdings are already not trivial. For instance: as 2018 has progressed and at recent lows Burberry was down nearly 25% from its 2017 peak, Sage down 22%, RELX 18%, Schroders and Hargreaves down 15% and Diageo nearly 12%. 10% declines are usually acknowledged as “corrections”, with anything at 20% or more down seen as a proper bear market. So some of these falls are getting interesting to us. Put it this way, one of the boosts to our performance over the period were the aforementioned bids for our holdings in software company Fidessa and
Dr Pepper. As a result we now have c6% of the portfolio which looks likely to come back to us as cash over the next few months. At the start of 2018, I might have hesitated about where to aggressively deploy 6% cash, given the strong returns from many holdings in 2017 and I might have wondered if a new holding might’ve been indicated. Today I’m not saying there aren’t new ideas that could be introduced to your portfolio, but I am saying that many existing holdings are looking compelling value to us again.

Nick Train

Director

Lindsell Train Limited

Portfolio Manager

21 May 2018

Investment Portfolio

as at 31 March 2018

		Market Value	% of
Investments	Sector	£’000	portfolio
Unilever	Consumer Goods	119,496	9.5
Diageo	Consumer Goods	117,802	9.4
London Stock Exchange	Financials	110,288	8.8
RELX	Consumer Services	108,110	8.6
Hargreaves Lansdown	Financials	95,371	7.6
Burberry Group	Consumer Goods	85,173	6.8
Heineken1	Consumer Goods	79,760	6.4
Schroders	Financials	72,841	5.8
Mondelez International2	Consumer Goods	69,682	5.6
Sage Group	Technology	67,354	5.4
Top 10 Investments		925,877	73.9
Daily Mail & General Trust (non-voting)	Consumer Services	46,575	3.7
Fidessa	Technology	44,218	3.5
Remy Cointreau3	Consumer Goods	42,388	3.4
Rathbone Brothers	Financials	30,048	2.4
Dr. Pepper Snapple2	Consumer Goods	29,801	2.4
Pearson	Consumer Services	28,761	2.3
A.G. Barr	Consumer Goods	28,547	2.3
Manchester United2	Consumer Services	19,516	1.6
Young & Co’s Brewery (non-voting)	Consumer Services	13,440	1.1
Euromoney Institutional Investor4	Consumer Services	11,529	0.9
Top 20 Investments		1,220,700	97.5
The Lindsell Train Investment Trust plc	Financials	10,050	0.8
Greene King	Consumer Services	8,712	0.7
Fuller Smith & Turner	Consumer Services	6,678	0.5
Celtic*	Consumer Services	4,354	0.3
Frostrow Capital LLP5 **	Financials	1,680	0.1
The Kraft Heinz Company2	Consumer Goods	710	0.1
Total Investments		1,252,884	100.0

All of the above investments are equities listed in the UK, unless otherwise stated.

¹ Listed in the Netherlands.

² Listed in the United States.

³ Listed in France.

⁴ An Associate Company of Daily Mail & General Trust.

⁵ Unquoted partnership interest.

* Includes Celtic 6% cumulative convertible preference shares, fair value £214,000.

** Includes Frostrow Capital LLP AIFM capital contribution, fair value £480,000.

Comparison of Sector Weightings with the
FTSE All-Share Index

as at 31 March 2018

			Finsbury Growth
	Finsbury Growth		& Income
	& Income	FTSE All-Share	(under)/overweight
Sector	%	%	%
Consumer Goods	45.9	14.8	31.1
Consumer Services	19.7	11.3	8.4
Financials	25.5	27.1	(1.6)
Technology	8.9	0.9	8.0
Oil & Gas	–	12.8	(12.8)
Basic Materials	–	7.7	(7.7)
Industrials	–	10.8	(10.8)
Telecommunications	–	3.3	(3.3)
Utilities	–	2.7	(2.7)
Health Care	_	8.6	(8.6)
Total	100.0	100.0	0.0

Income Statement

For the six months ended 31 March 2018

		(Unaudited)			(Unaudited)
	Six months ended 31 March 2018			Six months ended 31 March 2017
	Revenue	Capital	Total	Revenue	Capital	Total
	£’000	£’000	£’000	£’000	£’000	£’000
Gains on investments at fair value through profit or loss	–	19,006	19,006	–	60,260	60,260
Currency translations	–	(35)	(35)	–	(59)	(59)
Income (note 2)	9,973	–	9,973	8,330	–	8,330
AIFM and Portfolio Management fees (note 3)	(1,193)	(2,423)	(3,616)	(974)	(1,978)	(2,952)
Other expenses	(498)	–	(498)	(534)	(32)	(566)
Return on ordinary activities before finance charges and taxation	8,282	16,548	24,830	6,822	58,191	65,013
Finance charges	(112)	(227)	(339)	(123)	(249)	(372)
Return on ordinary activities before taxation	8,170	16,321	24,491	6,699	57,942	64,641
Taxation on ordinary activities	(149)	–	(149)	(11)	–	(11)
Return on ordinary activities after taxation	8,021	16,321	24,342	6,688	57,942	64,630
Basic and diluted return per share (note 4)	5.0p	10.0p	15.0p	4.5p	39.3p	43.8p

The “Total” column of this statement represents the Company’s profit and loss account. The “Revenue” and “Capital” columns are supplementary to this and are prepared under guidance published by The Association of Investment Companies (“AIC”).

All items in the above statement derive from continuing operations. The Company had no recognised gains or losses other than those declared in the Income Statement.

There is no material difference between the net return on ordinary activities before taxation and the net return on ordinary activities after taxation stated above and their historical cost equivalents.

Statement of Changes in Equity

for the six months ended 31 March 2018

		Share	Capital
(Unaudited) Six months ended 31 March 2018	Share	premium	redemption	Special	Capital	Revenue
	capital	account	reserve	reserve	reserve	reserve	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000
At 30 September 2017	39,724	572,791	3,453	12,424	515,039	20,990	1,164,421
Net return from ordinary activities	–	–	–	–	16,321	8,021	24,342
Second interim dividend (7.4p per share) for the year ended 30 September 2017	–	–	–	–	–	(11,786)	(11,786)
Issue of shares	1,688	48,904	–	–	–	–	50,592
At 31 March 2018	41,412	621,695	3,453	12,424	531,360	17,225	1,227,569
(Unaudited)
Six months ended 31 March 2017
At 30 September 2016	35,579	463,833	3,453	12,424	403,417	17,316	936,022
Net return from ordinary activities	–	–	–	–	57,942	6,688	64,630
Second interim dividend (6.6p per share) for the year ended 30 September 2016	–	–	–	–	–	(9,982)	(9,982)
Issue of shares	2,232	55,401	–	–	–	–	57,633
Cost of share issuance – Prospectus	–	(89)	–	–	–	–	(89)
At 31 March 2017	37,811	519,145	3,453	12,424	461,359	14,022	1,048,214

Statement of Financial Position

as at 31 March 2018

	(Unaudited)	(Audited)
	31 March	30 September
	2018	2017
	£’000	£’000
Fixed assets
Investments designated at fair value through profit or loss (note 1)	1,252,884	1,186,911
Current assets
Debtors	4,032	3,936
Cash and cash equivalents	9,820	11,482
	13,852	15,418
Current liabilities
Creditors: amounts falling due within one year	(2,467)	(1,208)
	(2,467)	(1,208)
Net current assets	11,385	14,210
Total assets less current liabilities	1,264,269	1,201,121
Creditors: amounts falling due after one year
Bank loan	(36,700)	(36,700)
Net assets	1,227,569	1,164,421
Capital and reserves
Share capital	41,412	39,724
Share premium account	621,695	572,791
Capital redemption reserve	3,453	3,453
Special reserve	12,424	12,424
Capital reserve	531,360	515,039
Revenue reserve	17,225	20,990
Total shareholders’ funds	1,227,569	1,164,421
Net asset value per share – basic and diluted (note 5)	741.1p	732.8p

Statement of Cash Flows

for the six months ended 31 March 2018

	(Unaudited)	(Unaudited)
	31 March	31 March
	2018	2017
	£’000	£’000
Net cash inflow from operating activities before interest (note 7)	6,147	4,612
Interest paid	(337)	(372)
Net cash inflow from operating activities	5,810	4,240
Investing activities
Purchase of investments	(49,294)	(58,553)
Sale of investments	3,607	–
Net cash outflow from investing activities	(45,687)	(58,553)
Financing activities
Equity dividends paid	(11,786)	(9,982)
Shares issued	50,036	58,222
Cost of share issuance	–	(89)
Net cash inflow from financing activities	38,250	48,151
Decrease in cash and cash equivalents	(1,627)	(6,162)
Currency translations	(35)	(59)
Cash and cash equivalents at 1 October	11,482	12,198
Cash and cash equivalents at 31 March	9,820	5,977

Notes to the Financial Statements

1. Basis of preparation

The condensed Financial Statements for the six months to 31 March 2018 have been prepared under the historical cost convention, modified to include the revaluation of investments and in accordance with FRS 104 ‘Interim Financial Reporting’ and with the AIC’s Statement of Recommended Practice (“the SORP”) for Investment Trust Companies and Venture Capital Trusts issued in November 2014 and updated in January 2017 and February 2018 with consequential amendments, and the Companies Act 2006.

The accounting policies used for the year ended 30 September 2017 have been applied.

Fair Value

Under FRS 102 and FRS 104 investments have been classified using the following fair value hierarchy:

Level 1 – quoted prices in active markets

Level 2 – prices of recent transactions for identical instruments

Level 3 – valuation techniques using observable and unobservable market data.

The financial assets and liabilities measured at fair value in the Statement of Financial Position are grouped into the fair value hierarchy at the reporting date as follows:

As at 31 March 2018

	Level 1	Level 2	Level 3
	£’000	£’000	£’000	Total
Equity investments	1,250,990	–	–	1,250,990
Limited liability partnership interest (Frostrow Capital LLP)	–	–	1,200	1,200
AIFM Capital contribution (Frostrow Capital LLP)	–	–	480	480
Preference shares investment	214	–	–	214
	1,251,204	–	1,680	1,252,884

As at 30 September 2017

	Level 1	Level 2	Level 3
	£’000	£’000	£’000	Total
Equity investments	1,185,077	–	–	1,185,077
Limited liability partnership interest (Frostrow Capital LLP)	–	–	1,200	1,200
AIFM Capital contribution (Frostrow Capital LLP)	–	–	480	480
Preference shares investment	154	–	–	154
	1,185,231	–	1,680	1,186,911

2. Income

	(Unaudited)	(Unaudited)
	Six months ended	Six months ended
	31 March 2018	31 March 2017
	£’000	£’000
Income from investments
Franked investment income
– dividends	8,781	7,278
Unfranked investment income
– overseas dividends	1,171	1,031
– limited liability partnership – priority profit-share on AIFM Capital Contribution	21	21
Total income	9,973	8,330

3. AIFM and Portfolio Management fees

	(Unaudited)	(Unaudited)
	Six months ended	Six months ended
	31 March 2018	31 March 2017
	£’000	£’000
AIFM fee	904	764
Portfolio management fee	2,712	2,188
Total fees	3,616	2,952

4. Return per share

The total return per share is based on the total return attributable to equity shareholders of £24,342,000 (six months ended 31 March 2017: return of £64,630,000) and on 162,609,813 shares (six months ended 31 March 2017: 147,584,316), being the weighted average number of shares in issue during the period.

The revenue return per share is calculated by dividing the net revenue return of £8,021,000 (six months ended 31 March 2017: return of £6,688,000) by the weighted average number of shares in issue as above.

The capital return per share is calculated by dividing the net capital return attributable to shareholders of £16,321,000, (six months ended 31 March 2017: return of £57,942,000) by the weighted average number of shares in issue as above.

5. Net asset value per share

The net asset value per share is based on net assets attributable to shares of £1,227,569,000
(30 September 2017: £1,164,421,000) and on 165,646,712 shares in issue (30 September 2017: 158,896,712).

6. Transaction costs

Purchase transaction costs for the six months ended 31 March 2018 were £247,000 (six months ended 31 March 2017: £259,000). These comprise of stamp duty costs of £221,000 (31 March 2017: £215,000) and commission of £26,000 (31 March 2017: £44,000).

Sales transaction costs for the six months ended 31 March 2018 were £2,000 (six months ended
31 March 2017: £nil). These comprise solely of commission.

These transaction costs are included within the gains on investments within the Income Statement.

7. Reconciliation of total return before finance costs and taxation to net cash inflow from operating activities

	(Unaudited)	(Unaudited)
	Six months ended	Six months ended
	31 March 2018	31 March 2017
	£’000	£’000
Total return before finance charges and taxation	24,830	65,013
Less: capital return before finance charges and taxation	(16,548)	(58,191)
Net revenue before finance costs and taxation	8,282	6,822
Decrease/(increase) in accrued income and prepayments	679	(165)
(Decrease)/increase in creditors	(21)	56
Taxation – irrecoverable overseas tax paid	(370)	(91)
AIFM and Portfolio management fees charged to capital	(2,423)	(1,978)
Other expenses charged to capital	–	(32)
Net cash inflow from operating activities	6,147	4,612

8. 2017 accounts

The figures and financial information for the year to 30 September 2017 are extracted from the latest published accounts of the Company and do not constitute statutory accounts for the year.

Those accounts have been delivered to the Registrar of Companies and included the Report of the Auditor which was unqualified and did not contain a reference to any matters to which the Auditor drew attention by way of emphasis without qualifying the report, and did not contain a statement under section 498 of the Companies Act 2006.

Interim Management Report

Principal Risks and Uncertainties

The principal risks and uncertainties facing the Company were explained in detail within the Annual Report for the year ended 30 September 2017. The Directors are not aware of any significant new risks or uncertainties and in the view of the Board these principal risks and uncertainties are applicable to the remaining six months of the financial year as they were to the six months under review.

The Company acknowledges the continued uncertainty surrounding the UK’s decision to leave the EU.

Related Party Transactions

During the first six months of the current financial year, no transactions with related parties have taken place which have materially affected the financial position or the performance of the Company.

Going Concern

The Directors, having made relevant enquiries, are satisfied that it is appropriate to prepare financial statements on the going concern basis as the net assets of the Company consist primarily of liquid securities, all of which, with the exception of the partnership interest in Frostrow Capital LLP, are traded on recognised stock exchanges.

Alternative Performance Measures

The Financial Statements set out the required statutory reporting measures of the Company’s financial performance. In addition, the Board assesses the Company’s performance against a range of criteria which are viewed as particularly relevant for investment trusts.

Directors’ Responsibilities

Each Director confirms that, to the best of his/her knowledge:

(i)   the condensed set of financial statements contained within the Half Year Report has been prepared in accordance with applicable accounting standards; and

(ii)  the interim management report includes a true and fair review of the information required by 4.2.7R and 4.2.8R of the UK Listing Authority Disclosure Guidance and Transparency Rules.

In order to provide these confirmations, and in preparing these financial statements, the Directors are required to:

•     select suitable accounting policies and then apply them consistently;

•     make judgements and accounting estimates that are reasonable and prudent;

•     state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

•     prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business;

and the Directors confirm that they have done so.

The Half Year Report has not been reviewed or audited by the Company’s Audotor.

The Half Year Report was approved by the Board on 21 May 2018 and the above responsibility statement was signed on its behalf by:

Anthony Townsend

Chairman

Glossary of Terms and Alternative Performance Measures (‘APM’)

AIC

The Association of Investment Companies.

AIFMD

The Alternative Investment Fund Manager Directive (the “Directive”) is a European Union Directive that entered into force on 22 July 2013. The Directive regulates EU fund managers that manage alternative investment funds (this includes investment trusts).

AIFM Rules

AIFMD and all applicable rules and regulations implementing AIFMD in the UK, including without prejudice to the generality of the foregoing the Alternative Investment Fund Managers Regulations 2013 (SI2013/1773) and all relevant provisions of the FCA Handbook.

Discount or Premium (APM)

A description of the difference between the share price and the net asset value per share. The size of the discount or premium is calculated by subtracting the share price from the net asset value per share and is usually expressed as a percentage (%) of the net asset value per share. If the share price is higher than the net asset value per share the result is a premium. If the share price is lower than the net asset value per share, the shares are trading at a discount.

FTSE Disclaimer

“FTSE©” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distributions of FTSE Data is permitted without FTSE’s express written consent.

Gearing (APM)

Gearing represents prior charges, adjusted for net current assets expressed as a percentage of net assets. Prior charges includes all loans and bank overdrafts for investment purposes.

	31 March	30 September
	2018	2017
	£’000	£’000
Prior Charges	(36,700)	(36,700)
Net Current Assets	11,385	14,210
Net Debt	(25,315)	(22,490)
Net Assets	1,227,569	1,164,421
Gearing	2.1%	1.9%

Leverage (APM)

The AIFM Directive (the “Directive”) has introduced the obligation on the Company and its AIFM in relation to leverage as defined by the Directive. The Directive leverage definition is slightly different to the Association of Investment Companies method of calculating gearing and is as follows; any method by which the AIFM increases the exposure of an AIFM it manages whether through borrowing of cash or securities, or leverage embedded in derivative positions.

There are two methods for calculating leverage under the Directive – the Gross Method and the Commitment Method. The process for calculating exposure under each methodology is largely the same, except where certain conditions are met, the Commitment Method enables instruments to be netted off to reflect ‘netting’ or ‘hedging’ arrangements and the entity exposure is effectively reduced.

The Board has set the leverage limit for both the Gross basis and the Commitment basis at 125%. These limits are monitored by both the Board and the AIFM.

Net Asset Value (NAV)

The value of the Company’s assets, principally investments made in other companies and cash being held, less any liabilities. The NAV is also described as ‘shareholders’ funds’ per share. The NAV is often expressed in pence per share after being divided by the number of shares which have been issued. The NAV per share is unlikely to be the same as the share price which is the price at which the Company’s shares can be bought or sold by an investor. The share price is determined by the relationship between the demand and supply of the shares.

Ongoing Charges (APM)

Ongoing charges are calculated by taking the Company’s annualised operating expenses expressed as a proportion of the average daily net asset value of the Company over the year. The costs of buying and selling investments are excluded, as are interest costs, taxation, cost of buying back or issuing ordinary shares and other non-recurring costs.

	31 March	30 September
	2018	2017
	£’000	£’000
Operating Expenses	8,244*	7,449
Average Net Assets during the period/year	1,219,087	1,043,305
Ongoing Charges	0.68%	0.71%

* Estimated expenses for the year ending 30 September 2018, as at 31 March 2018.

Net Asset Value Total Return (APM)

The total return on an investment over a specified period assuming dividends paid to shareholders were reinvested at net asset value per share at the time the shares were quoted ex-dividend. This is a way of measuring investment management performance of investment trusts which is not affected by movements in discounts or premiums.

The Company's half year report and financial statements for the six months ended 31 March 2018 has been submitted to the UK Listing Authority, and will shortly be available for inspection on the National Storage Mechanism (NSM):

http://www.morningstar.co.uk/uk/NSM

and on the Company’s website:

http://www.finsburygt.com/

(Documents will usually be available for inspection within two business days of this notice being given)

Victoria Hale
Frostrow Capital LLP
Company Secretary – 0203 170 8732

21 May 2018